Advertising

The Seattle Times Company

NWjobs | NWautos | NWhomes | NWsource | Free Classifieds | seattletimes.com

The Seattle Times

Business / Technology


Our network sites seattletimes.com | Advanced

Originally published July 10, 2007 at 12:00 AM | Page modified July 10, 2007 at 6:46 PM

E-mail article     Print view

Apple may launch cheaper iPhone model this year, analyst says

Apple may introduce a model of its iPhone this year that is 50 percent cheaper than the handsets that went on sale in the U.S. last month, JPMorgan Chase...

Bloomberg News

Apple may introduce a model of its iPhone this year that is 50 percent cheaper than the handsets that went on sale in the U.S. last month, JPMorgan Chase & Co. analyst Kevin Chang said.

The new model, based on Apple's thin iPod Nano, may cost less than $300, Chang said today by telephone from Taipei, citing a patent Apple filed in the U.S. and components suppliers he declined to identify. Apple began sales of two iPhone models priced at $499 and $599 on June 29.

A lower-priced iPhone may win customers away from rivals Nokia and Motorola, with Chang estimating Apple may ship as many as 40 million units of the new handset in the fiscal year ending September 2008. Apple will probably sell the new phone with several wireless carriers, unlike the five-year exclusive agreement it has with AT&T for the current iPhone, Chang said.

"We'll see this new iPhone having a noticeable impact on the handset market," Chang said. The new model may be introduced as early as the fourth quarter, he said.

Jill Tan, a Hong Kong-based spokeswoman for Apple, declined to comment on the report.

JPMorgan analyst Bill Shope in New York, who covers Apple, cautioned investors about Chang's predictions.

"The potential for a low-end, subsidized phone from Apple seems unlikely in the near term," Shope wrote in a separate report today. "Perhaps Apple will choose to eventually replace its iPod family with phones over time, but it could be premature to assume this will happen in volume any time soon."

Apple may release the next version of the iPhone in the first half of next year, Shope said. It will still be "high- priced" and support so-called third-generation networks for connecting to the Internet at faster speeds.

The new iPhone model won't have a touch screen like the current handset and will likely be controlled by a scroll wheel similar to those used on Apple's iPod music and video players, Chang wrote in the report published Monday. It will also have fewer functions, such as limited Internet browsing, he wrote.

Simpler features would allow Apple to sell the handset with multiple carriers, as operators won't need to customize their wireless networks for the phone's services, Chang said. Subsidies provided by carriers may further lower the price of the new model to as little as $99, he said.

Apple ran out of iPhones at more than half its 164 stores less than a week after introducing the handset, and AT&T said it sold out at its 1,800 outlets within 24 hours. Apple said it is delivering iPhones to its stores and AT&T shops every day.

Information from Bloomberg News reporter Connie Guglielmo is included in this report.

Copyright © 2007 The Seattle Times Company

More Business & Technology headlines...

E-mail article Print view      Share:    Digg     Newsvine

advertising

Nintendo re-enlists Mario, savior of video-game industry

Verizon-Frontier deal stirs concern among consumers

Brier Dudley: 'Guitar Hero' founder excited about future

Gaps for consumers in Democrat health care bills

Hutch gets $10M from Bezos family for immunotherapy research

Advertising

Video

Real Salt Lake wins MLS Cup
Real Salt Lake defeated the Los Angeles Galaxy with penalty kicks after 120 minutes of play at Qwest Field in Seattle.

Raw Video | Real Salt Lake receives the MLS Cup trophy
Raw Video | Real Salt Lake fans celebrate
Real Salt Lake fans enter Qwest Field
Raw Video | MLS Cup Opening Ceremony
LA Galaxy's David Beckham
Real Salt Lake's Kyle Beckerman
MLS trophy arrives in Seattle
Chittenden Locks Inspection
Full interview with New Moon actors

Marketplace

Advertising